Correlation Between GlaxoSmithKline PLC and Amplify ETF
Can any of the company-specific risk be diversified away by investing in both GlaxoSmithKline PLC and Amplify ETF at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining GlaxoSmithKline PLC and Amplify ETF into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between GlaxoSmithKline PLC ADR and Amplify ETF Trust, you can compare the effects of market volatilities on GlaxoSmithKline PLC and Amplify ETF and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in GlaxoSmithKline PLC with a short position of Amplify ETF. Check out your portfolio center. Please also check ongoing floating volatility patterns of GlaxoSmithKline PLC and Amplify ETF.
Diversification Opportunities for GlaxoSmithKline PLC and Amplify ETF
-0.92 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between GlaxoSmithKline and Amplify is -0.92. Overlapping area represents the amount of risk that can be diversified away by holding GlaxoSmithKline PLC ADR and Amplify ETF Trust in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Amplify ETF Trust and GlaxoSmithKline PLC is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on GlaxoSmithKline PLC ADR are associated (or correlated) with Amplify ETF. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Amplify ETF Trust has no effect on the direction of GlaxoSmithKline PLC i.e., GlaxoSmithKline PLC and Amplify ETF go up and down completely randomly.
Pair Corralation between GlaxoSmithKline PLC and Amplify ETF
Considering the 90-day investment horizon GlaxoSmithKline PLC is expected to generate 4.54 times less return on investment than Amplify ETF. But when comparing it to its historical volatility, GlaxoSmithKline PLC ADR is 1.05 times less risky than Amplify ETF. It trades about 0.01 of its potential returns per unit of risk. Amplify ETF Trust is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 1,670 in Amplify ETF Trust on August 30, 2024 and sell it today you would earn a total of 535.00 from holding Amplify ETF Trust or generate 32.04% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
GlaxoSmithKline PLC ADR vs. Amplify ETF Trust
Performance |
| Timeline |
| GlaxoSmithKline PLC ADR |
| Amplify ETF Trust |
GlaxoSmithKline PLC and Amplify ETF Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GlaxoSmithKline PLC and Amplify ETF
The main advantage of trading using opposite GlaxoSmithKline PLC and Amplify ETF positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GlaxoSmithKline PLC position performs unexpectedly, Amplify ETF can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Amplify ETF will offset losses from the drop in Amplify ETF's long position.| GlaxoSmithKline PLC vs. Novartis AG ADR | GlaxoSmithKline PLC vs. AstraZeneca PLC ADR | GlaxoSmithKline PLC vs. Roche Holding Ltd | GlaxoSmithKline PLC vs. Bristol Myers Squibb |
| Amplify ETF vs. Invesco Dynamic Leisure | Amplify ETF vs. US Global Jets | Amplify ETF vs. Global X Infrastructure | Amplify ETF vs. ProShares Online Retail |
Check out your portfolio center.Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..
Other Complementary Tools
| Odds Of Bankruptcy Get analysis of equity chance of financial distress in the next 2 years | |
| Stock Screener Find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook. | |
| My Watchlist Analysis Analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like | |
| Portfolio Optimization Compute new portfolio that will generate highest expected return given your specified tolerance for risk | |
| Economic Indicators Top statistical indicators that provide insights into how an economy is performing |